Project Risk Management Report

The Global Partnership on Output-Based Aid

Improved Access to Communications in Rural Cambodia
April 9, 2008

Submitted by Group 5:
2B4033 - Myat Thada Kyaw
2B4059 - Yem, Socheath
2B5056 - Suos, Kumpina
2B5010 - Bist, Stuti
2B5015 - Dubey, Alok Kumar
2B4026 - Kipkoech, Robin Pik
2B4031 - Mi Kyi Kyi Han

International University of Japan (Winter Term, 2016)

I. Contents
II. Background ................................................................................................................................... 1
III. Project Descriptions ..................................................................................................................... 2
1. Project Name............................................................................................................................. 2
2. Project Objective ....................................................................................................................... 2
3. Project targeting and Location ................................................................................................ 2
4. Project Scope ............................................................................................................................. 2
5. Project Milestones .................................................................................................................... 5
IV. Project Stakeholders Management ............................................................................................. 5
1. International Partner............................................................................................................... 5
2. Institutional and Implementation Partner ............................................................................ 5
V. Financial Management ................................................................................................................ 6
1. Procurement Contractual Agreement ..................................................................................... 6
2. Project Funding ........................................................................................................................ 7
VI. Project Risk Management ........................................................................................................ 7
1. Risk Identifications and Assessments .................................................................................... 7
2. Risk Matrix ............................................................................................................................... 8
3. Schedule Estimation ................................................................................................................ 9
3.1. Gantt Chart ........................................................................................................................... 9
3.2. Project Schedule Simulation (ModelRisk of VOSE Software) ........................................... 9
4. Risk Management Planning .................................................................................................. 12
 GPOBA Improved Access to communications in Rural Cambodia

II. Background

The International Network Connectivity in Cambodia was re-established in 1987 with Satellite
which supported by Soviet Unions. Between 1997 and 1999 the first fiber optical network
backbone was connected three countries – Cambodia, Thailand and Vietnam. Between 2007 and
2009 another project called Great Mekong Sub-region Information Highway was expanded
these three countries to Laos through four provinces in Cambodia.

Even the telecommunication network for this country, Cambodia, have been developed rapidly,
some rural and remote areas were facing with poor communication. Therefore, the development
of ICT, which is the key factor for economic development, consist of a very hug gap between
urban and rural.

The Global Partnership on Output-Based Aid (GPOBA), World Bank Agency, was assumed this
issue, rural communication accessing, as a key challenge. Among 14.4 millions of population in
2008, there were 18 percent were living in urban and the rest in rural area. Furthermore, based
on the National Institution of Statistic (NIS) reported that 28.1 percent of households in City
were connecting fixed line phone whereas there are only 5.8 percent were accessing fixed line
phone in rural areas.

The economy for those remote area were lag far behind the urban due to the operation process
were costly including communication and transportation. In 2008 the Optical Fiber Network
were under construct while the satellite link was cost efficient.

As a result there were five provinces were setting as the project target, see Exhibit 1.

Province Total Population Districts Communes Villages

Banteay Meanchey 680,251 8 64 635

Otdar Meanchey 147,913 5 24 231
Preah Vihear 143,565 7 49 208
Pursat 391,481 6 49 501
Source: GPOBA commitment paper of Cambodia Project, 2008
Exhibit 1: Target Provinces

SUBMITTED BY GROUP 5: 1
 GPOBA Improved Access to communications in Rural Cambodia

III. Project Descriptions

1. Project Name

The project was named Improved Access to Communications in Rural Cambodia with ID

P102475.

2. Project Objective

The first objective of the project was to access voice telephony service for low income families

in rural area. The second object was to demonstrate a private public partnership through the

GPOBA.

3. Project targeting and Location

The target for this project was low income and remote area families and located in north and

north-west of Cambodia. Specifically, the target approximately consists of 261,000 people or

52,200 households (2009, NIS report)

4. Project Scope

The scope of this project was detailed in form of project scope statement as following:

 Project acceptance criteria:

1. Basic telephony communication service –the telephony technology and full network
accessing would be provided with the quality and subsidiary price.
2. Basic access to services – the Service Provider make sure that its service would be in
target of 80% of household in villages.

 Project Output/Deliverables: based on the above acceptance criteria, the project can

contribute the output as following:

 There are three deliverables from basic voice telephony connection:

1. The targeting location can access telephone technology

2. Better performance regarding to congestion network and dropped call (respond to

the rest of Cambodia Network)

3. Telephone calling in each targeting can volume up.

SUBMITTED BY GROUP 5: 2
 GPOBA Improved Access to communications in Rural Cambodia

 There are also three deliverables based on the basic access service:

1. Access points are required to access at least 80% villages in targeting areas.

2. The service for access point is ranged 8 hours a day and 5 days a week.

3. Volume of outgoing calls from the public access number.

 From additional service to be offered by Service Provider, it not only increases the

revenue, but the service provider may also offer and reduce the number of subsidy.

 Project Scale: the following table show the number of target and the expected number of

beneficiaries of the project.

Province Expected number Districts Communes Villages

of beneficiaries
Banteay Meanchey 105,997 7 13 136
Otdar Meanchey 61,944 4 11 72
Preah Vihear 41,860 7 24 99
Pursat 51,168 3 6 45
Total 260,969 21 52 352
Source: GPOBA commitment paper of Cambodia Project, 2008
Exhibit 2: Target Scale of the project

1. Project Cost: The total investment fro was estimated at USD $4,751,914. And there are

other two funding windows; window 1 is USD $491,737 and window 3 is USD

$2,625,595.

2. Project duration: About 2 years

3. Human Resource: The project was prepared and run by GPOBA and Ministry of Posts

and Telecommunication of Cambodia (MPTC). The employees would be selected from

those both organizations, assumption is about 23 employees including external

recruitment. See exhibit 2 for more detail of human resources management.

SUBMITTED BY GROUP 5: 3
 GPOBA Improved Access to communications in Rural Cambodia

 Core Team:
Name Title Unit

Natasha Beschorner Task Team Leader, Senior ICT Policy Specialist CITPO
Cledan Mandri-Perrott Sr. Infrastructure Specialist FEU/GPOBA
Naomi Halewood Co-TTL, Operations Analyst CITPO
Joshua Gallo Infrastructure Specialist FEU
Arturo Muente Kunigami ETC (rural telecommunications specialist) CITPO
Juan Navas-Sabate Senior Telecommunications Specialist CITPO
Rajendra Singh Senior Regulatory Specialist CITPO
Kashmira Daruwalla Senior Procurement Specialist CITPO
Ahsan Ali Senior Procurement Specialist EAPCO
John Richardson Governance Specialist (Consultant) EAPCO
Sokunthea Sok Procurement Assistant EAPCO
Kannathee Danaisawat Financial Management Specialist EAPCO
Bunlong Leng Environmental Specialist EASES
Vanna Nil Social Development Specialist EASSO
Roch Levesque Senior Counsel LEGEA
Maria Lourdes Pardo Consultant LEGES
Gilbert +Tobin Telecommunications Consulting Law Firm External

 Advisory Team:
Name Title Role Unit

Patricia Veevers-Carter Program Manager Peer Review/ Advisory FEU/GPOBA

Irving Kucynski Panel of Experts Review/Advisory GPOBA

Alejandro Jadresic Panel of Experts Review/Advisory GPOBA

Iain Menzies Sr. Infrastructure Peer Review/ Advisory FEU/GPOBA
Specialist
Lars Johannes operations Analyst Peer Review/ Advisory GPOBA

Source: GPOBA commitment paper of Cambodia Project, 2008

Exhibit 3: Project Human Resources

SUBMITTED BY GROUP 5: 4
 GPOBA Improved Access to communications in Rural Cambodia

5. Project Milestones

The project was documented in April 9, 2008 and estimated to close in 2010. Here are the key
milestones if this two-year project (see exhibit 4).
Activities Indicative Schedule
GPOBA provides subsidy commitment April 2008
Documentation to government for review, including Grant Agreement May 2008
Bidding documentation to government for review August 2008
Signature of GPOBA Grant Agreement August 2008
Launch of Bid September 2008
Contract Award December 2008
Project Implementation and Subsidy Disbursement begins December 2008
Recruitment of Independent Verification Agent August 2009
Mid-Term Review June 2010
Recruitment of Independent External Auditor October 2010
GPOBA Subsidy disbursement ends December 2011
Source: GPOBA commitment paper of Cambodia Project, 2008
Exhibit 5: The key milestones of the project

IV. Project Stakeholders Management

1. International Partner
This project was supported and funded by only GPBA only.
2. Institutional and Implementation Partner
The contract will be created between service providers or contractors and the MPTC. The
responsibilities are shown in exhibit 7.

Institutions Responsibilities
MPTC 1. Project coordination
2. Operations manual
3. Providing technical inputs/specifications/designs for bidding document
4. Providing term of reference for consulting service
5. Formation of procurement review committees, and
6. Contracting administration and execution

SUBMITTED BY GROUP 5: 5
 GPOBA Improved Access to communications in Rural Cambodia

Independent 1. Preparing bidding document and inviting bids/proposals

Procurement 2. Evaluating and selecting service provider/consultants
Agency (IPA) 3. Assisting in negotiating and finalizing contract for singing by MPTC
Independent 1. Measuring outputs against prescribed criteria
Verification 2. Monitoring and evaluating project elements
Agent
Independent Reviewing internal controls in the project and compliance with the financing
External Auditor agreement.
GPOBA or Assistance in development of the overall project concept, and financing for
World Bank consultancy service and investment subsidy
Selected Provide communications service in target locations in accordance with their
Operator contract with MPTC.
Source: GPOBA commitment paper of Cambodia Project, 2008
Exhibit 6: Stakeholder Management and Responsibilities

V. Financial Management
1. Procurement Contractual Agreement
Almost procurement processes were responded by Independent Procurement Agent (IPA).
Somehow, the contract with MPTC (Ministry of Posts and Telecommunication of Cambodia)
were required for some technical and design support. Exhibit 6 show the process of contractual
agreement and funding flow.

GPOBA

MPTC

Contractor / IVA / Auditor Other Beneficiaries IOC

Source: GPOBA commitment paper of Cambodia Project, 2008

Exhibit 6: Contractual Arrangements and Funds Flow

SUBMITTED BY GROUP 5: 6
 GPOBA Improved Access to communications in Rural Cambodia

2. Project Funding
Total
Component US$ million
US$ million
Project Subsidy: Voice telephony (Window 3) $2,375,957 $2,375,957

Consulting Services:

(i) Management and Administrative support to (i) $10,000 $115,000

Implementing Agency (Window 3)

(ii) Independent External Auditor (Window 3) (ii) $35,000

(iii) Independent Verification Agent (Window 3) (iii) $70,000

Incremental operating costs (IOC) $10,000 $10,000

Bank supervision for subsidy implementation $124,638 $124,638

TOTAL GPOBA Funding $2,625,595

VI. Project Risk Management

1. Risk Identifications and Assessments

Risk identification base on Scope, Cost, Schedule, environment, …

Risk ID Risk Impact Likelihood

Resource_001 Failure of the subsidy bidding Medium Not likely

Resource_002 Sustainability Medium Not likely
Resource_003 Selection of non-acceptable area or Low Almost certain
technically unreachable sites
Resource_004 MPTC has no experience with Bank Medium Almost certain
funding project
Resource_005 Service doesn’t comfort to the voice or Low Almost certain
inter-operability of service standards of the
mobile operators network as a whole
Cost_001 Weak financial control environment as Medium Likely
limited segregation and duties
Cost_002 Affordability and willingness to pay for High Almost certain
new phone service by the poor and very
poor.

SUBMITTED BY GROUP 5: 7
 GPOBA Improved Access to communications in Rural Cambodia

Cost_003 Exchange rate in Cambodia base one USD Low Not likely
dollar
Scope_001 Scope would be change if High Not likely
telecommunication regulation would be
released
Scope_002 Measure and monitoring of service quality Medium Likely
and access availability
Scope_003 Selection of distribution channel(s) Low Likely
Policy_001 The ICT policy will be changed High Not likely
Schedule_001 Funding delay High Not likely
Environment_001 3 months of reason in Cambodia can slow Medium Almost certain
down installing speed
2. Risk Matrix

Based on the Risk matrix, Environment_001 which causes by three months of the heavy rain in
Cambodia can be medium impact with almost certain on project; therefore, this risk cannot be
ignored - it should be mitigate in effective way.

This risk required to

SUBMITTED BY GROUP 5: 8
mitigate effectively
GPOBA Improved Access to communications in Rural Cambodia

3. Schedule Estimation
3.1. Gantt Chart

3.2. Project Schedule Simulation (ModelRisk of VOSE Software)

SUBMITTED BY GROUP 5: 9
 GPOBA Improved Access to communications in Rural Cambodia

Likelihood Days Year/Month/Day Finish Date

99% 978 2years8months4days 12/12/2010
Total Duration
97% 977 2years8months3days 12/11/2010
97% 976 2years8months2days 12/10/2010

 Histogram Plot
Simulation Name Simulation #1

Number of Iterations 5000

Seed 110855032

 Statistic Plot
Variable Name Total duration Total duration

Cell reference [Book1]Sheet1'!H$15 [Book1]Sheet1'!I$15

Variable Type Output Output

Simulation # Sim: 1 Sim: 1

Location

Mean 974.9939915 N/A

Minimum 971.2911634 N/A

SUBMITTED BY GROUP 5: 10
 GPOBA Improved Access to communications in Rural Cambodia

Maximum 978.2806466 N/A

# of Errors 0 5000

# of Filtered 0 0

Spread

St. dev. 1.163291617 N/A

Variance 1.353247386 N/A

CofV 0.001193127 N/A

Shape

Skewness -0.016349379 N/A

Kurtosis 2.696361651 N/A

Percentiles

1.00% 972.3277112

3.00% 972.8295882

5.00% 973.0985932

8.00% 973.3449308

10.00% 973.4752817

15.00% 973.7614126

20.00% 973.9654854

25.00% 974.1984176

30.00% 974.360514

35.00% 974.5223291

40.00% 974.6932543

45.00% 974.8446197

50.00% 974.9797315

55.00% 975.1345525 N/A

SUBMITTED BY GROUP 5: 11
 GPOBA Improved Access to communications in Rural Cambodia

60.00% 975.2962718 N/A

65.00% 975.4628083 N/A

70.00% 975.6302447 N/A

75.00% 975.8358313 N/A

80.00% 976.0224926 N/A

85.00% 976.2390171 N/A

90.00% 976.5105184 N/A

92.00% 976.645617 N/A

95.00% 976.9117605 N/A

97.00% 977.1726972 N/A

99.00% 977.6366037 N/A

4. Risk Management Planning

No Risk Prevention Contingency Plan Trigger Owner

Failure of the subsidy Issue the bidding Consultations with After 10 days Operator
bidding publicly thought winning bidders on other still no bidding
multi-channel sites to recognize their
reasons for not offering to
1 bid on the ignored sites,
and what is required to
stimulate their
participation in a
re-bidding.
MPTC has no A qualified MPTC World Bank to provide After World
experience with Bank staff may be training on Bank policy launching the Bank and
funding project appointed to and procedures on project MPTC
2
handle both financial management and
administrative and disbursement during
finance tasks project launch workshop.
Weak financial control All payments will An independent auditor to Immediately GPOBA
3 environment as limited be made via direct be appointed to audit the after reported
segregation and duties payments with full Project Financial from internal

SUBMITTED BY GROUP 5: 12
 GPOBA Improved Access to communications in Rural Cambodia

supporting Statements or external

documentation. auditor
The subsidy
payments will be
made upon
verification of
specified outputs
Affordability and Low cost SIM It depends on the One month GPOBA
willingness to pay for cards is the main successful bidder/operator after on-air and
new phone service by condition before undertaking marketing to service operator
4 the poor and very poor bidding sell ULCH and low cost
SIM cards bundled with
giveaways to get service
use results.
Scope change due to Making a contract Deeply cooperate with Regulation MPTC
5 telecoms regulation with MPTC MPTC as a PPP (Private support and
would be released Public Partner) report
3 months of reason in Dynamic schedule Segment the task based on Heavy rain Operator
6 Cambodia can slow based on actual the season more one day
down installing speed season

SUBMITTED BY GROUP 5: 13